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tv   Street Signs  CNBC  October 17, 2013 2:00pm-3:01pm EDT

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here. pea body, sandisk and verizon. very nice gains there. that's it for us at "power lunch." >> i hope you'll come back tomorrow, will you? >> i liked it so much, back tomorrow. >> save some of those oreos for me, will you? >> i will. >> "street signs" will begin right now. the good news is we have a debt deal. the bad news, t minus 90 days until we're back at square one with the same fight ahead and more bad news, we still have the same congress. we're hitting all kinds of stock stories but we want to hear from you. what do politicians need to do to win you back? >> okay. with a deal in the books this is where the markets are standing. small and mid caps are at all-time highs. the s&p 500 has taken out its record close of 1725, and it is really only a few points from its all-time intraday high of
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1729.86. as for the dow see it's a little red there, it would be higher if it wasn't for ibm, unh and goldman sachs. let's get straight to the trading floors. bob pisani at the nyse. let's move over washington for a second, at least for a while, let's concentrate on the matters at hand such as earnings. you know what they're not so great. >> no. i'm a little bit concerned. i've been saying this the last several days. look, the ibm, ibm is a big price stock. the dow is a price weighted index, put it up, it's hard for the dow to move forward when you have a stock that's down 12 points. that's 75 points on the dow jones dow jones. united health a little disappointed. other companies out, that issued comments that are not particularly great. semi conductors a bunch of them. cypress, these are comments on the future, the current quarter. weakness in the mobile hand seth market, fairchild is weak. sales in the current quarter
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below consensus. xilinx, flat growth for the december quarter. all these stocks here down on essentially what's comments on the current quarter not the prior quarter quarter. if these numbers keep coming down they're going to get to the point where the overall market will be concerned by them. something just as i was walking over here i saw michael koors moving to the downside. this just happened. trying to get some information on it happening. i checked a couple other ones. coach has moved down in the last minute or two. coh, just happened, i'll get to information and find out what happened and get back to you on that. back to you. >> we'll hold you to that. thank you very much. from wall street let's head to washington where it's been a busy day. john harwood at the white house. give us the latest. >> the latest is the government is back up and running and congress is beginning to try to see if they can come up with a long-term budget plan they haven't been able to come up with up to now. president obama commemorated the end of the shutdown at the white
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house today with white house workers who were back on the job. he was clearly still angry aibot the disruption caused by that shutdown but said it's time for washington to work together to win back the confidence of the country. >> how business is done in this up to has -- town has to change. we've all got a lot of work to do on behalf of the american people and that includes the hard work of regaining their trust. our system of self-government doesn't function without it. >> we've got a note of realism on "squawk" senator john mccain, barack obama's opponent in 2008, he said yes, we're going to start a budget process, but nobody should get too overoptimistic about the prospects for a grand bargain. >> it probably won't happen because it's been tried so many times with all different gimmicks, you know, select committees, super committee, gang of, numbers you want to fill in.
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why don't we try the regular process, a -- we have a budget committee. the house passes a budget, the senate passes a budget, then they confer and they come out with a budget. why don't we try that for once. >> what that little bit of civics 101 adds up to is expectations on both sides not for a grand bargain that would involve far reaching medicare, social security cuts, the democrats would accept, tax increases that republicans would accept, more likely a smaller deal that would alleviate parts of the budget sequester that each party doesn't like, substitute some longer term entitlement savings for that, the two budget committees are meeting in a conference, they've got until mid-december to work that out and see what they come up with, guys. >> thank you very much, buddy. appreciate it. well, i hate calling this a deal because really it's just congress kicking the debt condition down the road. still it is what it is and we need to look for opportunities because even in the worst, most insane of times, there are, indeed, opportunities.
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joining us now wells capital management jim paulson and s&p capital iq sam stowball. >> with all this other stuff where are you find something opportunities now? >> well, i think first thing i guess i would point out is the international markets, brian, have been outperforming the u.s. stock market now for the last couple months. i think that's going to continue. the currency, the u.s. currency against developed world markets as well as emerging markets are -- is now weakening and it's weakening even more today and that's giving excess returns to overseas. i think one of the best opportunities is to put a little more both in international developed and international emerging markets, relative to the domestic market. >> do you know -- to that point i saw a graphic on a different show earlier today on cnbc and it was talking about a guest that said the guest name, likes italy or europe because of political stability. and i thought to myself, i need a drink. because i don't -- i can't
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believe someone's like wow we're looking at europe now as some sort of model of political stability. >> i'm not sure i would go that far, but what's happened is the united states we may be accelerating from 2.5% to 3% growth maybe next year but europe is going from negative growth to positive growth, that's a much bigger net net change which causes a bigger change in valuations. not only in the stocks, but also in the currency. it's giving a bid to the euro. same thing happening in japan. after slowing almost two years is starting to pick up. those are bigger delta changes than what's happened in the united states. it's going to give a bid and momentum in the national markets. >> we're smack bang in the middle of earnings season and we're increasingly hearing guidance come out from a number of big companies here in the united states and they are blaming washington. how much of this is real and how much is just an excuse like the weather used to be in the past? >> that's right. hello, mandy, hey, jim in the
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background. >> i think companies are going to be looking to blame whoever they can blame other than themselves. the bar is set pretty low. s&p capital iq consensus numbers looking for about a 3% increase in the third quarter but i think that like we've seen in the past, that company management has probably done a pretty good job managing expectations and we'll end up with an actual number that ends up being a little bit higher and i think that the market might end up surprising investors, maybe the international will do well as jim mentioned but i also think you don't want to count out the small cap stocks. they are not typically canaries in a coal mine pointing to a potential bear market and if a lot of the larger cap managers are underperforming their benchmarks they're probably going to engage in some style drift and look to increase octane by dipping into the mid and smaller cap arenas. >> of course we're going to get a little performance anxiety as we get to november. the small caps are already at record highs. when you say the market could end up surprising us, how much
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of a surprise? how much in a percentage terms do you think we could see of upside before the end of the year, sam? >> i think we're actually getting close to where we believe we're going to end the year. the reason i say that is, our 12-month target for the s&p is 1845 with an awful lot of volatility between now and then. if you take just sort of an annualized approach, then it probably implies 1730 to 1740 end for this year. but our belief is that we're not headed for recession, earnings growth is likely still to be in the mid to upper single digits as we move forward over the next year or so and valuations, while not compelling, are still appealing because they're trading at discounts to the quarter century averages. >> all right. so jim, last thing you've sold? what have you been dumping if you like europe? >> yeah. well i would in this country, i would make sure i have my bond exposure down. i think the ten-year might still end the year closer to 3% and
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next year i think it's going to go higher again. so i would make sure i pare that back. as far as the stock i traded out of some industrials recently. i'm about to go back into those as they've pulled back a little bit. the financials have pulled back here in the united states. i think they're attractive on a relative basis. and then what i -- what has gotten a good momentum, i believe, is the material stocks here which is starting to move up as the dollar is starting to come down. i like tech but i'm not so enamored maybe with what sam said, more enamored with small than the big ones that suffer an age problem. >> jim and sam, thank you very much. i guess good things don't come in small packages, mandy. thanks, guys. >> there are always exexceptions to the rule. >> up next on "street signs," congress or root canals? which do you think rates better with the american public? the answer is probably not
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surprising. >> also later on, even the president says we are fed up with washington. so, let's d.c. proof our portfolios for good. how can you shield yourself from congress's kicking the can down the road and cramer will be with us as well. >> we're on all-time high watch for the s&p 500 and actually it is a good day for stocks. you see the dow is down. don't be confused. couple names like goldman, ibm and a few others, otherwise most are higher. a positive day for the stock market despite the red arrows. back right after this. ♪ [ male announcer ] when we built the cadillac ats from the ground up to be the world's best sport sedan... ♪ ...people noticed. ♪ the cadillac ats -- 2013 north american car of the year. lease this cadillac ats for around $299 per month
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okay. . riddle time. i is more popular root canals or congress? the answer is actually not so shocking is it, jane wells? >> well, at this point, everybody is saying root canal. almost everybody. i have to tell you, here at patty's the talk often well right now the talk about baseball behind me but often turns to politics. people have been asking how low can public opinion of congress go. a pew research poll found 74% of voters want the crew in washington thrown out. that means 26% don't? but nearly 4 in 10 say they want their own representative gone and that number is the highest pew going back over 20 years. but voters almost never follow through with that. it still in the great shutdown of october 2013 how does
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congress going back look? >> it seems like our government ought to be able to get along and resolve these issues and this infighting is ridiculous. >> i'm canadian so it's a joke to me. >> it is embarrassing. i think it's embarrassing. i'm very proud to be american. we're the most philanthropic country in the world and yet we can't get things going straight here at home for ourselves. >> you know, the best part of this whole shutdown has been a poll by public policy polling asking americans what they like worse than congress? what they like better than congress? first what they like better? cockroaches, wall street, which some people would consider the same thing, hem roads, mothers in law and public radio fund-raising driving. what's worse? syria, lindsay lohan, twerking, the ebola virus and charles manson. guys, 26% of those asked weren't sure which was worse, charles
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manson or congress. back to you. >> that is puff. jane wells, thank you very much. we're going to get someto some congress members, we have on just a moment. breaking news right now in silicon valley on an executive shakeup in ibm. john fortt, what is the news? >> yeah. a bit of a shift here, brian. ibm had said last night on the earnings call, that bruno delay yo who used to head up growth markets based in shanghai is back, trying to fix the china situation that caused so much consternation on the call last night with the hardware business down 40% year other year. he's getting the original team together that built that growth market unit. but the other fallout is that jim, bra mante, one of the first promotions when she came in january 2012 he has been reassigned out of that growth market position in shanghai while the strike team gets in and tries to fix this difficult situation on the ground.
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brian? >> all right. thank you for bringings us the breaking news. ibm stock down nearly 7%. you heard jane wells talking at a diner and some say congress has the worst approval ratings in our lifetimes. what must congress do now to win americans back and restore confidence in washington. let us bring in joyce badie of ohio and robert pittingger. i'm going to ask both of you to begin the interview, no blame. too much of what we've heard has been blaming the other party. nobody that's gop or dem is ever going to blame their own party. we get that. focus on solutions if we can. representative beatty, i'll begin with you. how do you win back the trust of americans and american business? >> i think what you have to do is use what happened in the last two days as a great example. the american people want to see us working together. they want to see us reaching across the aisle. and that's what happened when you look at what we did to raise
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our debt ceiling. we were about to have democrats in leadership and reasonable and rationale republicans to come together. the american people have said to us, no matter what the political issues are, or the public policy issues are, they wanted americans to be back at work, they wanted us to strive with our economy and grow the economy, and that's what we did. and we did that because the leaders got together and that's what's allowing us to move forward. and i think we're going to see that as we continue between now and february the 14th because we should stop the blame and thank goodness yesterday in the senate that we had a large number of senators who reached across the aisle as republicans and voted with the majority and we saw the same thing last night on the house floor. >> yet, pretty dire when you're all being compared to cockroaches. representative, what are you doing to make things better now? >> well, that's a wonderful question.
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and it's a great objective. you know, no matter who you talk to, leading economists or peter yor zach who is the budget writer for mr. obama, ear skin bowles who i know who was a budget writer for mr. clinton or paul ryan, they're saying the same thing, unless we get our spending under control, that we are on a trajectory where we'll financially collapse like greece. that's a bipartisan group. i was at an airport with erskine a few weeks ago as we chatted i said what takes you to washington? he said i'm headed up there to introduce paul ryan at a dinner. they get the big picture. that's what we need to be about. unfortunately, the great concerns of our debt and our spending, we need to keep on the table. >> but congress -- >> taking in $2.5 trillion and spending $3.5 trillion. >> okay.
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i'm going to ask you the same question and get some quick answers here hopefully starting with you representative beatty. what are you going to personally do and guarantee and promise your constituents so in about 90 days we don't have this again? >> one of the things i'm going to do is continuing meeting with my constituents. we've held town hall meetings. we're going to share with them the truth it's going to take three things. not just looking at our spending because certainly they know that in the last two years, we have had less federal spending since the korean war. we're also going to look at how we can have tax reform. working together with americans and the working people, working together with corporate americans and we're also going to be able to look at what are those things that we can do to reduce the deficit, so i think it's three things. but it's working in a bipartisan fashion. it's not blaming. i was so proud when the president of the united
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states said, he was willing to work with everyone and that's why we're moving america forward. and those are some of the things i'm going to do back home. we're going to have town halls, we're going to work together. if you look at how we voted last night in my district, if central ohio, the three members of congress stood together as democrats and republicans in my hall and in my district, democrats and republicans are starting to work together because we know it's not blaming one another as some of my colleagues have been doing and it continue to do today. >> words are fantastic and we love hearing these words about working together, but representative pittinger, we have only a small amount of time here before as brian said we have to go through all of this again, the american public, the world has to go through this again, what do we do to be more productive? what's the first thing on your agenda to make this work? >> when i came into congress i help founded a group called united solutions. it was a bipartisan group and
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remains that today. we signed a letter 37 of us to the president imploring him to address the debt and to deal with the long-term spending of our country, that we must get under control. i will continue with the united solutions. we meet just about every week. many various groups of us and we're going to work together to seek every solution that we can in a bipartisan way to address these major issues. if we don't get this spending and debt under control interest rates will go up as quantitative easing is relaxed, that could take our debt interest from $230 billion a year to a trillion dollars a year. we have to focus on these issues. >> all right. representatives, thank you both very much. we heard some great things. we're going to hold -- remember in the age of the internet nothing is lost. i've learned that the hard way. so thank you very much for coming on.
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we'll bring you back on to talk more about this. >> that's why they call them sound bites. they an come back to bite you. >> to breaking news just coming in to cnbc. the breaking news desk. >> manty, thanks so much. new details on sac the hedge fund settlement talks with the southern district of new york. the justice department pursuing them for insider trading. talks are making incremental progress and we could potentially see a deal as early as the end of october that the fine currently being discussed in the realm of $1.5 billion, although a key issue is whether or not a prior settlement that sac already paid would be deducted from that. i'm told sac becoming a family office is not something on the table as part of these discussions although it is a lingering issue in general and perhaps in a nod to that founder steve cohen in the last few years and this year has actually downsized the size of his personal trading book, mandy and brian. kind of an interesting development there.
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i'm told he likes to be prepared for anything. reorganized the firm a while ago but some legal issues to think about as well. >> thank you very much. always great reporting from kate kelly. still ahead on the show, yesterday's three earnings squad names, ibm, goldman sachs, and united health really to blame for dragging the dow down and we've been saying this all along. it would be positive if not for those names. so you better listen up for today's big three names out of the earnings squad before they report. >> later on, herb, i told you so, greenberg is back on. he's going to talk about an etf whose name doesn't really belie what's actually in the etf, plus jim cramer will join us as well. good debate and stock discussions, lot of stock stuff, street talk, get away from the political stuff, coming up. >> let's do it. [ banker ] sydney needed some financial guidance
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welcome to the earnings squad. we dissect the stories everyone is talking about and help you trade the stories you may have missed. joining me is kate kelly and the
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doc, jon najarian and author of "how we trade option." first to the score koords, with 16% of the s&p 500 reporting so far, 20% have come in below forecasts. kick it off with morgan stanley, all eyes on the big banks set to report earnings tomorrow morning and kate, this is after a lot of banks have already come out and indicated that fixed income has been terrible. >> that's right. i think that's been one of the main take aways from this bank earnings season and shocking today goldman sachs's results, down 44% in fixed income, traditionally a cash cow but year over year really not a strong performer. their cfo said obviously they were disappointed but they also talked about the macro environment. speaking of that, more of that from james goreman probably tomorrow, other executives at morgan stanley. it will be interesting to hear what they have to say given the size of their retail brokerage and they tend to hold more treasuries than their peers because of that. what have they done in the
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recent environment. >> the recent environment meaning the shutdown? >> absolutely. and the fears about holding shorter term treasuries how did they handle that and position going forward? >> and did they get any benefit from the business that goldman didn't get this quarter. did that come over to morgan stanley. we'll see tomorrow morning. >> all right. we're watching chipotle set to report its third quarter earnings after the bell today and we're looking for any impact of the shutdown as well. we already heard about a slowdown in a lot of different retail sales numbers in the month of september going into october and so the question for chipotle is, did the consumer continue to spend when it comes to casual dining and quick serve restaurants. this stock has been a monster up about 86% from its bottom so it's had a tremendous run. lot of analysts are turning bullish on the stock and one of them at janney cites the untapped potential of breakfast. no plans right now to test a breakfast menu but, you know, breakfast burritos, would you like that? that sounds like it has -- >> you would love that.
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breakfast burritos, anything you can do to use the space during a 24 hour clock or 18 hour clock instead of a 12 hour clock is a good thing. >> how many ofs us have gone to what would be a dinner restaurant at the airport because they're servingl bagels or something and you need something. >> ha could be a driver here. we're watching intuitive reporting after the bell, dr. j. >> benign hiss rec thomes down with intuitive surgical. the machines are $1.5 million apiece. that's one of the issues. the other is they've got an fda warning letter that has people worried and one of the reasons that and the affordable care act perhaps why they might put off expanding this particular type of surgery which is more expensive but less invasive and a lot of patients may not be opting for it. >> they already cut guidance so that is going to -- we're going to see what they say about guidance for the rest of the year when they report after the bell. join the conversation tweet us
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#ooerngssquad. back tomorrow on squawk. brian back over to you. >> still ahead on "street signs," shutdown winners and losers. the sectors that gained the most because it will probably happen again, so we're going to figure out what worked this time. that's coming up. plus jim and herb don't go anywhere. ♪ ♪ [ male announcer ] eeny, meeny, miny, go. ♪ ♪ more adventures await in the new seven-passenger lexus gx. lease the 2014 gx 460 for $499 a month for 27 months. see your lexus dealer. plays a key role throughout our lives. one a day men's 50+ is a complete multivitamin designed for men's health concerns as we age. with 7 antioxidants to support cell health. a day men's 50+.
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we do it every day, this time street talk, let's get the sandisk levels not seen since 2006. >> upgraded to buy or to strong buy from buy. price target raised to 90 from 80, 30% more than the current price. flash memory maker revenues rose 28%. this was a $74 stock in january of '06. inching closer. >> we've got solar city overweight at jpm. >> that initiation has the stock up 4.5%. 27% higher than the current price. ipoed in december at $8. it's at $55. 8 to 55. that's high. >> don't appreciate it. overstock, quarterly profit of 14 cents a share, missing estimates by a tiny bit. >> short sellers favorite. they've gotten smoked on this
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name. not today. the stock is down. get this, overstock is blaming google. they're saying a change in the algorithm on google pushed back their results further down the page or maybe on the next page, and you want to be at the top. everybody clicks the front page. actually blaming google. gross margin better than some hoped. a stock that was 5 bucks basically 18 months ago. it's crushed. >> better to blame google than congress or the weather. absolutely tanking. down -- >> 62%. >> down 62.9%. the fda voting it greater use of its drug designed to lower triglycerides, say it should not be approved for a broader patient population yet. additional studies need to be analyzed. jpmorgan, hg, humphrey, i mean, this was up, mandy, a $15 stock 15 months ago. we talk about bioteches, the great side of them. this is the bad side.
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this what is can happen. >> ebay shares are down around 4% after the on-line giant provided a not so merry outlook for the holidays. but is the weakness in ebay a buying opportunity? let us begin talking numbers. on the technicals, jonathan, chief technician at miller taback, fundamentals, zach, president of river twice research and a cnbc contributor. jonathan, let us start with you. and the charts. what are the charts saying about ebay? >> brian, ebay is a great company. we've all used it. looked at items and see the buy it now button. but when we look at the stock we would be look it for the sell it now button. you'll see what we're talking about here. back in 2004 ebay paekds at $64 a share, massive decline in the market, subsequent rally back up to that 58 to $60 level. earlier this year where it failed. in addition breaking its trend line off the 2009 lows. both of those are quite negative. look at a little bit of a shorter term chart, we can see
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ebay has been bouncing off this $50 support level. it's now the fifth time it's tried to hold that support. so far it's healed but under a declining 150 day moving average. never a good setup for us. we would stay away and look elsewhere. >> zach, do you agree? >> i do not agree with that. the stock has clearly been range bounded. it's not been a great thing to own or buy although it certainly hasn't hurt you in any strong way over the past 6 to 12 months. i didn't love the fact that the earnings call there was some blame of, you know, government shutdown given that most of the quarter occurred before the government shutdown. going who can we hold responsible? our business is weak because congress is stupid. >> government shutdowns are the new weather. >> i know. it's a great -- just use it. >> just blame -- i'm going to blame everything in my life now on the government shutdown. why don't you take out the trash, government shutdown. why were you speeding? government shutdown. >> sales are up, government shutdown. >> why haven't you showered in a week, government shutdown. mobile payments and the roll of paypal because paypal is the driver of this, not the marketplace part f you're going
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to go for the marketplace part go with amazon, but paypal as a mobile payment and europe and globally remains a vibrant business, much better than some of the competitors such as verifone and i think donahue is a good ceo with a strong management team. i feel like this is probably going to keep going higher, not lower. >> good stuff. technical sell, fundamental buy. i blame your disagreement on the sghoon absolutely. >> thank you very much. >> thank you. >> check out the on-line addition of talking -- unless you can't access the internet because of the government shutdown. >> really? it's been a week? t minus 90 days until at the doorstep of another crisis. how can you d.c. proof your port flol? we'll get some names. >> later on, ibm is a big mess today. should the mere fact that the legendary ceo, sam stepped down about two years, leave be a sell signal? herb greenberg and jim cramer are here and discuss and debate, but first, bill griffeth, do you have a show today or not because of the government shutdown?
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>> oh, do we ever sully. coming up, look at this. the s&p 500 is on pace to close at a record high. find out if it's full steam ahead. the turmoil in d.c. has been pushed to the sidelines for the moment. all eyes on google's earnings after the bell. that will set the tone for tomorrow. we'll have instant analysis and reaction to google's numbers coming up on the "closing bell." kelly evans with me today. we look forward to seeing you at the top of the hour after "street signs." stay tuned. i am today by luck. i put in the hours and built a strong reputation in the industry. i set goals and worked hard to meet them. i've made my success happen. so when it comes to my investments, i'm supposed to just hand it over to a broker and back away? that's not gonna happen. avo: when you work with a schwab financial consultant, you'll get the guidance you need with the control you want.
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are choosing fidelity. now get 200 free trades when you open an account. next two guests have d.c. proof stock picks for you with 90 days until the next crisis in washington these are stocks they think you should be looking at. susan, joins us from the heart of the chaos our nation's capital. susan likes bristol miles, yum brands and emmerson and here on set someone who got the hell out of the nation's capital, michael. both of you, great to have you on the show. susan, to bristol myers squibb hitting this spot on two fronts. aging baby boomers and play on obama care.
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>> bristol myers squibb has a nice dividend and we like dividends but more importantly, it has some stuff in the pipeline that we think fit both the baby boomers and obama care. one is a new diabetes drug that we think is going to be widely adapted. -- adopted. the other is a cancer drug that it's been working with with pfizer that's also coming on to the pipeline. we've got a superior dividend and growth in ooerngs. >> and you love, it's brian, yum brand. make the case for tacos and pizza? >> well, i personally can't make a case for tacos and pizza. i think they're terrible. but a lot of people eat them and they make a lot of money. and we're capitalists actually here in this country and they have done a very good job of monetizing their product. they had some problems in china. we think are over. and again, they have a dividend that's grown at a very regular
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rate and has, you know, has -- is supported by really good earnings. >> don't forget, kentucky fried chicken. >> oh, yes. actually i can be tempted. >> chinese growth from the consumer and 50% of their growth from china. i like yum brands. don't be worried about the avian flu. >> what about you, michael you like chevron, rockwell collins. >> i'll go in your order. i think chevron is a good, nice big oil company. only 5% of their production comes from the middle east. they're growing production. look, ten times earnings, growing earnings at 8 or 9% with a 3.3% dividend. i think there's defense from washington there. rockwell collins, this has got a foot in the commercial avionics and cockpit sort of equipment. half military, half commercial. they counter balance each other. 15 times earnings. 12% growth. >> wait. when you said military isn't
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that a little susceptible when you consider the sequester and defense cuts? >> no question. but they've been counter balancing. when the military has traded off the commercial has picked up. at 15 times growing earnings at 12% which i think is sustainable it's a cheap stock when you think about 6 or 7% earnings growth and 1% dividend, stryker. >> ten stryker. >> guys, i've got to go. stay here. i want to hit breaking news on blackberry. dow jones says -- what's that? all right. thank you, kevin. kevin's my producer. sometimes we communicate telepathically like this. according to dow jones, lin nova pc maker signed a nondisclosure agreement to look at blackberry's books. not a deal but look at the stock up 1.5%. a pop. they could say your books don't look good and not do it, but they are looking at blackberry. any reaction, michael?
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>> blackberry has a lot of value to be unlocked. probably by somebody other than blackberry. they've got a great list of subscribers. they've got some people wed to some old technology. this is a great customer base. the demographics for blackberry users is terrific. so somebody who cap cross sell and use the technology in that income stream makes a lot of sense. >> what about you, susan? do you think this makes a lot of sense some. >> i think somebody can buy blackberry and turn it around. i don't think anyone -- >> if we can use somebody to buy washington and turn those jerks around that's what we need to find next. >> do either of you own the stock? blackberry stock? >> no, i don't own blackberry. i use blackberry but i don't own it. i'm old and -- >> you hate tacos and pizza but love blackberries. >> i love the little buttons. >> there you go. >> okay. >> sometimes we'll push them. >> i got my iphone and i'm trying to convert. >> thank you. leave it there.
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good discussion. >> up next, forget cash under the mattress. herb says some inveriers are already hiding the money in the mattress and don't know it. buy what you know kind of lesson. >> and should it be your signal to sell jur stock. one stock getting crushed today might be proving that thesis, cramer and herb about it to come by and debate it. i love having a free checked bag with my united mileageplus explorer card. i've saved $75 in checked bag fees. [ delavane ] priority boarding is really important to us. you can just get on the plane and relax. [ julian ] having a card
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these are the scripts being officially thrown out because we have breaking news. blackberry stock is up 1.5%. dow jones reporting that linovo, chinese maker of pcs signed a nondisclosure agreement to look at the books. no deal, sniffing around. jim and herb. we're going to talk about other stuff but we have this breaking news. what's your take? >> first, lenovo is limited on capital. it could had happen. blackberry, i always felt that security of blackberry is so important and so fabulous and so respected by corporations, that it's got to be worth a couple billion dollars, just the security, the literal hardware security. so this lenovo deal would make sense. i think the other guy -- >> of course the report -- the reports various other >> various other companies have been sniffing around blackberry. i heard names like fwogoogle,
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cisco. obviously the preliminary offer from fairfax. i think the co-founders want to look around there as well. who do you think would be the best fit for taking over some or part of blackberry. >> google would be interesting. >> yeah? >> again, i want a secure network. i want to feel my network can't be violated. one of the reasons why blackberry had such success for so long, you go to a bank. the bank will say, listen, we can't -- we have to use blackberry because the security is the best there is. that's got to be worth something. it's never talked about as intellectual property value. >> jim, you know, with the apple, the iphone, core corporations now embracing other technologies, the security is there with other technologies. and when it comes -- i have to say something about this. the last guest, the prior, before the break, someone went on and said blackberry can be turned around. it can't be turned around. whoever buys it it's a nice fit in for them. let me become the custodian. >> do i need -- >> let me finish. they become the custodian of
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blackberry and what it is. what it will be is what it is right now. >> need i remind you, herb, okay, that canadians hate the australians. right? because they blocked the bhp billiton bill for potash. what makes you think the canadian government would allow a chinese company to purchase probably the leading intellectual property corporation of canada? when they wouldn't even let an australian company buy one of them. >> look, this rumor, the lenovo rumor has been out there for a long time. when it was first -- the stocks move -- the algorithms make the stocks move on any headline. we know that. people think there's value there. this thing's been moving all around. the point you make about china was made back when these rumors first surfaced. very good point. >> obviously there are those issues of national security out there. i wonder, jim, you know, blackberry has been in the past, maybe not so much now, a real
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jewel in the crown for the canadian economy the way that nokia was for finland. don't you think maybe the canadians would prefer to see blackberry saved by a chinese company rather than worry about the national security? >> i think that -- that will blackberry go under if nothing happens? look at nortel. remember when nortel was the jewel of the canadian crown? where did they go? >> there's a couple guys out there. we need to get jim back on. anybody that's trying to value lenovo right now is in large ways guessing. what you're doing is you're trying to analyze intellectual property that may have a huge amount of value or may have nothing. >> that's why google -- >> because of what happens in the future. >> that's why i think herb, as much as i respect your analysis, i think it's a black box. i know someone who thought the security business was worth $2 billion. i'm talking about a real fund that was trying to position
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something. i mean, look, they could be -- >> where are they? where are they, jim? why haven't they stepped up? >> because the rest of the business is falling apart. like you said. the business is falling apart. it's a moving target. kodak, were know those patents are worth something. that's why i'd love to hear from your guy. the rest of the business is falling apart. may not matter. >> since we're talking about lenovo, there's ibm which has been the worst performer on the dow so far this year. they're saying the chinese impact, what's going on there with the hardware business, that's going to be felt for a couple of quarters. what do you think of ibm, jim? >> i don't like -- i used to have a rule at my old hedge fund. try to keep that with ""mad money"." don't by the first year of a new ceo. too much could go wrong. that would have saved you a lot when it comes to this particular situation. >> what's interesting -- >> go ahead. >> can i say something? what's interesting, it was announced when he was stepping down. i was on air at cnbc. it came as such a surprise. you wanted to say, is he getting out while the getting is good?
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remember, two quarters after he left officially as ceo, you started that six quarter run of negative sales growth. what did he really see? >> this was an open rebellion, herb, as you know on that conference call. basically said, row knoyou know are you guys now? it was kind of like -- >> then mlanovich in ubs comes out and says credibility is at a low. to see that from a veteran analyst in the space was quite astounding. >> more importantly, you know them as well as i do. they're both really nice guys. this was not easily done. these were not snipers. these are guys you really when you know in the business, you're like, you know what? i'm going to be forgiving. i really want to trust. they were just -- it was a knife in the back. >> it was something when saginathi had his comment, the company's response immediately
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was, tony? as usual. very good question. >> i know. i love that. >> okay. is there a thesis, then, jim, that you sell when a big ceo leaves? because if that's a case, what we're saying is, sell microsoft because balmer is stepping down. >> they have to have a good record. >> okay. >> right, right. if they're stepping down and they were terrible it's a good thing. >> what a great run at ibm. fabulous. warren buffett, it's the full faith and credit of warren buffett. which actually what's happened in washington is certainly worth more than we see down there. warren buffett, i think he might be wrong on this one. remember how many years he said i don't want to own tech. he violated his own rules owning tech. this was terrible. how about we do a billion dollars in cloud this quarter.
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mark benioff does a billion dollars in cloud. there's $96 billion -- you know what i mean. >> we know what you mean, jim. thank you very much, herb, for joining in as well. tonight on "mad money" ceo of ewe knighted rentals and kinder morgan. tonight 6:00 and 11:00 p.m. >> perfect. i'm going to be in texas all next week. i'm going to blow your mind, jim. >> my staff said, oh, aren't you jealous of brian? i said, no, brian is actually the most supportive guy of your show. >> let's break up the love fest. breaking up the love fest. next, the city where housing is hot, hot, hot. bad, bad, bad? >> what? bny mellon combines investment management & investment servicing, giving us unique insights which help us attract the industry's brightest minds who create powerful strategies for a country's investments which are used to build new schools to build more bright minds.
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dallas fed president dick fisher seeing fresh signs of a housing bubble. there are worries that miami, poster child for the last housing bubble, is just too hot. robert frank as more. >> the numbers really tell a story. median prices in miami up 23% in the third quarter over last year. the high end has been on fire. look at the top 10% of sales in miami. medium price for a condo now $1.2 million. sales up 19% for sing. for single family homes, median price up 16%. number of sales up 24%. this condo at south beach sold for $4.8 million in 2009.
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just sold again for 9.5. that's double your price in four years. another property. a beach house in coral gables. sold for $9.8 million. properties sell about $1,000 per square foot. this one sold for 1rkz$1,500 a square foot. manhattan prices. with a little more sunshine. >> thank you, robert frank. >> thank you all for watching. "closing bell" starts right now. welcome to "the closing bell." i'm kelly evans in for maria bartiromo. stocks a mixed day after the crisis in washington averted at the last minute, bill. >> see the dow there. the market is a little deceiving today. the industrial average would actually be positive if it wasn't for one stock. ibm. which reported those disappointing earnings last night. by the way, the s&p 500 is on track to close at a record high, believe it or not.

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